Episode #27 of the Risk Intel Podcast engaged in a conversation with Strategic Risk Associates (SRA) Co-founder and CEO of SRA Consulting, Michael Glotz. Ed Vincent, CEO of SRA Watchtower's SaaS side of the business and host of the show explored the significance of risk improvement activities, often referred to as "issue tracking." This podcast shed light on how this crucial aspect of risk management is integrated into SRA's Watchtower platform and its pivotal role in optimizing risk management.
In the early days, risk improvement activities were known as "issue tracking." This may seem like a minor semantic shift, but as Michael Glotz pointed out, it’s a small change in verbiage that significantly impacts how we approach risk management. By renaming these activities as "risk improvement," a positive connotation is introduced. It's not just about identifying issues; it's about strengthening the organization's risk profile and taking a proactive approach to managing risk.
One of the key takeaways from this conversation is the importance of centralization in managing risk improvement activities. While decentralization might work for individual departments to address issues, it's vital to have a centralized system for reporting and monitoring. This not only ensures consistency across the organization but also fosters a better risk culture. Michael emphasizes moving away from outdated approaches like using Excel spreadsheets and adopting a more modernized approach to risk management.
Regulators, as discussed in the podcast, are vigilant about the risk management practices of financial institutions. They seek an effective system for assessing, managing, monitoring, and mitigating risks. The mitigating aspect, or risk improvement activities, is a crucial component that requires a structured, organized approach. Regulators want to see that banks have centralized systems in place, allowing them to track issues, take action, and demonstrate oversight and progress.
During the podcast, Michael Glotz shared several best practices that organizations should consider when implementing risk improvement activities:
This Risk Intel Podcast episode provides valuable insights into optimizing risk management by centralizing and organizing risk improvement activities. By adopting a more positive approach and following best practices, organizations can not only meet regulatory expectations but also enhance their risk culture. Risk management is not just about identifying issues; it's about continuously improving and strengthening an organization's risk profile.
Incorporating centralized risk improvement activities into your risk management strategy can lead to a more robust and resilient financial institution. With the ever-evolving landscape of financial risks, the proactive approach advocated in the podcast can help organizations thrive in the face of challenges.